Lexmark Expands Database, Offers Targeted Campaigns

Lexmark International Group, a leading maker of computer printers and related products, next month plans to rapidly expand its database of existing customers' e-mail addresses to be used for a targeted permission-marketing campaign later this year.

Lexmark began its first Internet marketing program in September, testing an e-mail newsletter that went out to 10,000 names, all of which the company collected inhouse. It quickly increased the mailing to 170,000 inhouse names in October and will further expand this effort next month.

The newsletter, which includes new product information, product applications and a link to Lexmark.com, has received an excellent response, according to Brett Butler, general manager of worldwide Internet marketing at Lexmark, Lexington, KY. "Our click-through rates have been in the high single digits," he said.

The company plans to build its lists by using the many channels it has at its disposal, the greatest of which is the company's toll-free number. It receives upwards of 35,000 calls per month.

Lexmark tested 500 callers per month between September and December, asking them to provide their e-mail addresses in exchange for receiving a free newsletter. More than half of the callers agreed. "This is just about the best source of names you could get," said Butler.

Lexmark is also compiling product registration and rebate redemption information, all of which will be used for future e-mail correspondences. "It was amazing to stand back and look at how many customer touches we have, yet we didn't have an efficient way of communicating with them," he said.

Next month, the company will contact non-customers as well by testing a number of opt-in e-mail lists. It plans to try 10,000 names at a time from providers such as PostMasterDirect and YesMail.

The second step in the company's e-mail marketing plan is to mine its database to help create targeted messages for consumers. "We need to figure out how to better use the database. If we know what our consumer's interests are, we can better deliver a message. If we know you're interested in digital photography we can tune our message to that," he said.

Butler said this "critical element" of Lexmark's marketing efforts would begin no later than March.

Reaching consumers with the right message is essential to building loyalty, he said. "In the printer business that's what it's all about, having them stay loyal to our cartridges and our printers. We want to take advantage of the fact we can market directly to the consumer to increase loyalty to our products over a period of time. Talking directly to them with a permission marketing-based [platform] has to help with loyalty."

The cost-effective nature of permission marketing has caused Lexmark to adjust its marketing strategy as a whole. "Direct marketing is pretty expensive. If I had $10,000 to spend on a test, I'd get a whole lot more experimenting done in the online space," said Butler.

Lexmark has no plans to call off its offline direct marketing efforts. However, the company is currently using e-mail and the Web to better qualify customers before sending them a more expensive direct marketing piece. "E-mail marketing will compliment direct marketing, but it will never truly take its place," said Butler.

The e-mail marketing program is being run by Net Marquee, which was acquired by Circle.com, Baltimore on Dec. 7.

Aside form e-mail marketing, the company is budgeted to run targeted banner ads and keyword buys in the near future, although it is not banking on any one of these strategies.

"We're going to test first and then expand whatever works," said Butler. "I fully expect half the things we do not to pay out, but that's the value of marketing on the Internet in general. Its very efficient in terms of cost and quick in terms of feedback."

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